Foreword

This State of the Banks report presents our perspective on the Belgian banking sector, combining analysis of the annual and risk disclosures of FY2025 from the six Belgian banks under ECB supervision, together with qualitative insights derived from a dedicated workshop held in May 2026 with HR leadership from 4 large banks, conducted in collaboration with Febelfin. This dual lens reflects the reality that financial performance and strategic workforce transformation are increasingly interdependent.

Belgian banks entered 2026 in a profitable state, but under growing structural pressure. FY2025 results confirm the resilience of the sector, with income growth holding up and asset quality remaining broadly stable despite a weakening macro-economic backdrop. At the same time, the analysis reveals a widening gap in how institutions are positioned for what comes next. The central challenge is no longer financial resilience, but strategic adaptation.

That divergence is visible across several dimensions. Business models are gradually shifting, with fee income becoming a more important driver of growth as net interest income normalizes. Cost discipline has been maintained despite wage inflation and rising regulatory levies, primarily through cuts in discretionary spending rather than structural reduction. At the same time,

early signs of stress are emerging in parts of the corporate portfolio, with a more uncertain outlook for credit quality into 2026.

Technology and transformation are important differentiators, but not the only ones. Artificial intelligence (AI) has moved into scaled use cases in areas such as financial crime and customer servicing, yet the broader picture is one of uneven execution. Differences in legacy infrastructure, workforce readiness, and governance maturity are creating a dispersion in how effectively banks translate technology investment into tangible outcomes.

The external environment reinforces these internal divergences. Geopolitical uncertainty, regulatory change, and evolving ESG expectations are increasingly shaping provisioning decisions, investment priorities, and management attention, with banks making different strategic trade-offs in response.

Ultimately, the banks that will outperform are those that convert strong current performance into sustained adaptation, by aligning business model evolution, risk management, and transformation at the required pace.

This report is intended to support professionals, stakeholders, and industry practitioners in understanding the evolving challenges and opportunities shaping the banking landscape. We welcome any feedback on this report and encourage you to reach out to us for further discussions.

Koen De Loose
Head of Financial Services
KPMG Advisory

Benjamin Steyfkens
Director, Financial Risk Management
KPMG Advisory

Bernd Carette
Director, Strategic Workforce Planning
KPMG Advisory